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Friday, 05 March 10
COAL RALLY ON CHINESE DEMAND SPARKS $59 ESTIMATES
 Bloomberg reportd that, A rally that has boosted coal prices 21 percent from their lows last year may have further to go as the coldest U.S. winter in nine years and China’s record imports increase demand and drain stockpiles.
Prices will average $59.28 a ton this year, up 17 percent from $50.75 as of Feb. 19 on the New York Mercantile Exchange and 41 percent more than last year’s low in April, according to the median of 11 analyst estimates in a Bloomberg News survey. Stockpiles at utilities swelled last year after a mild summer and the economic recession reduced power demand.
China, the world’s biggest coal user, imported 16.4 million metric tons in December, a sixfold increase from a year earlier, customs data show. Record snowfall buried parts of the U.S., the second-biggest coal consumer, including Dallas and the mid- Atlantic states. The cold weather is reducing a surplus and giving producers Patriot Coal Corp., Consol Energy Inc. and Alpha Natural Resources Inc. power to negotiate higher prices.
“We’re definitely bullish for a confluence of factors,” said Jeremy Sussman, senior coal analyst at Brean Murray Carret & Co., a New York-based boutique investment bank. “We can see the light at the end of the tunnel in the U.S. The weather has definitely had an impact. The international market is front and center.”
Consol, the second-biggest U.S. coal company by market value, will jump 18 percent to $59 by the end of this year in New York trading, according to the median of 17 analyst estimates compiled by Bloomberg. Alpha, the third-biggest U.S. coal producer by output, will climb 22 percent to $57.46, analysts forecast.
Patriot Rises
Patriot rose 35 cents, or 2 percent, to $17.62, today in New York Stock Exchange composite trading, the highest price since Jan. 21. Consol added 3 cents, to $49.94. Alpha slipped 16 cents, or 0.3 percent, to $46.94. Massey Energy Co., the sixth- biggest U.S. coal producer, climbed 12 cents, or 0.3 percent, to $44.39.
Hedge funds have been buying energy producers, mining companies and airlines, a sign that managers from Louis Bacon to David Tepper are convinced the economy will accelerate. Duquesne Capital Management LLC, led by Stanley Druckenmiller, bought 6.2 percent of Massey, whose earnings are projected to double this year.
The increased U.S. and Chinese consumption prompted Michael Dudas, an analyst at Jefferies & Co. in New York, to raise his 2010 price target for coal to $70 per ton, a figure he originally forecast for 2011.
Coal Inventories
“The weather and better electricity generation have pushed stockpiles lower than people anticipated,” said Dudas, who has followed coal for a decade. “It’s really just accelerating that price.”
Utilities have 57 days worth of coal on hand, down from more than 70 days at the start of winter, according to Genscape Inc., a Louisville, Kentucky-based energy data provider.
“The pricing increases are real,” Consol Chief Operating Officer Nicholas Deiuliis said in a telephone interview. “If you look at the pricing increases we’re seeing now in regard to future sales, they have not only floored or held their bottom, they are starting to spike up.”
Coal is used to generate electricity and produce steel, making it a barometer for the economy. U.S. steel capacity utilization tumbled to 68 percent as of Feb. 15 from 91 percent in August 2008, according to the American Iron and Steel Institute, as unemployment climbed to 10 percent and consumers reduced spending 3 percent on appliances in December from a year earlier.
Prices Slide
The U.S. summer from June through August was 7 percent cooler than the same period a year earlier, reducing demand for power to run air conditioners, according to the National Oceanic and Atmospheric Administration.
Prices plunged 66 percent to $48.15 per ton at the end of 2009 from a record $143 on July 1, 2008, the steepest decline in at least eight years, according to data compiled by Bloomberg. The 17 percent gain forecast by analysts would be the largest since 2007.
Utilities amassed a record 207 million tons as demand for coal to generate electricity dropped 12 percent through Sept. 30, according to the most recent U.S. Energy Department data. Consumption for 2009 was projected to be below 1 billion tons for the first time since 1995. The government will release final figures in March.
Producers cut back output as demand slumped and that’s having an impact even as demand rises. U.S. coal production will slump about 2.8 percent this year just as exports increase 5.6 percent, the Energy Department said Feb. 10.
Record Snowfall
The 2009-2010 winter season, which began Dec. 1, is the coldest since the 2000-2001 season and ranks in the coldest third of winters in the past 115 years, according to Jeff Masters, director of meteorology for Weather Underground Inc., a private forecaster based in Ann Arbor, Michigan.
The federal government shut down for four days this month after Washington was hit with a storm that set a seasonal snow total of 54.9 inches, shattering a 110-year-old record.
For St. Louis-based Patriot, Pittsburgh-based Consol and Alpha, based in Abingdon, Virginia, the frigid conditions are providing relief.
“The cold weather is the best thing they can get right now that’s not a full economic recovery,” said Daniel Scott, an analyst at Dahlman Rose & Co. in New York. “People are no longer scared to talk about thermal coal.”
Interest Rates
The risk to forecasts for higher coal prices is a glut of natural gas in the U.S. and prospects for the economy to stumble as the Federal Reserve boosts interest rates for the first time since June 2006. The Fed last week raised the discount rate charged to banks for direct loans by a quarter point to 0.75 percent to encourage banks to borrow in private markets.
“If the economy tanks again, that changes the outlook,” according to James Rollyson, senior coal analyst at Raymond James Financial Inc. in Houston. “The economy and particularly this year natural gas prices are the variables. Coal lost market share to natural gas because we averaged $4 gas for the year.”
The U.S. relies on coal for about half of its power generation, compared with about 20 percent for gas.
Gas has to stay above $5 per million British thermal units to prevent it from being more attractive to utilities at the expense of coal. Natural gas for March delivery fell 14.9 cents, or 3 percent, to $4.895 per million Btu. Rollyson estimates that through November coal lost about 40 million tons worth of demand to gas.
Chinese Imports
China’s National Energy Administration said Jan. 25 that a coal shortage will persist through March. The country has maintained the record import pace set in December because of the country’s coldest winter in at least 50 years, according to Sutthichai Kumworachai, an analyst with KGI Group in Bangkok.
The country’s gross domestic product expanded 10.7 percent last quarter from a year earlier, the fastest pace since 2007, after the government introduced a $586 billion stimulus package that spurred energy consumption.
China’s appetite for coal led to imports from South Africa, diverting supplies from Europe and creating an opportunity for eastern U.S. coal companies such as Alpha Natural Resources, Consol and Patriot to increase sales across the Atlantic Ocean, Brean Murray Carret’s Sussman said.
This year Consol has sold almost 500,000 tons of coal into Asian markets, a 23 percent increase from the 400,000 tons that it shipped to the region for the first time last year, Dan Zajdel, a company spokesman said. As more companies follow, the exports will squeeze U.S. utilities, said Pearce Hammond, an analyst at Simmons & Co. International in Houston.
Lower Temperatures
“That’s essentially robbing utilities of coal,” Hammond said. “They don’t need it right now, but in the future they will.”
From the mid-Atlantic to the Southeast through the Gulf Coast into Texas, temperatures are averaging 4 degrees to 8 degrees below normal, said Tom Kines, a senior expert meteorologist with AccuWeather.com in State College, Pennsylvania.
“That is pretty significant,” he said.
The cold is having an impact as measured by heating-degree- day values, which have been trending higher along the East Coast and across the South, according to the National Weather Service. The value is calculated by subtracting the average daily temperature from a base of 65 degrees and is designed to show energy demand.
New York Weather
This month, New York’s heating-degree-day value is 572, or 36 greater than normal, according to the National Weather Service.
Coal prices will get a larger boost if the U.S. economy can sustain its recovery, Alpha Chief Executive Officer Kevin Crutchfield said in an interview. The world’s largest economy will grow 3 percent this year and next, according to the median estimate of 62 economists surveyed by Bloomberg News.
“That would be the best thing in the quiver, a bona-fide economic recovery, especially on the industrial side,” Crutchfield said. “If you see any type of economic stimulus and economic recovery at all, that would hasten the recovery even faster.”
Source: Bloomberg - Mario Parker
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Friday, 15 January 10
ADARO INDONESIA STILL TOPS IN INDONESIAN COAL EXPORT RANKING
COALspot.com (Indonesia): PT. Adaro Indonesia, the world first Envirocoal producer and Indonesia's second largest thermal coal producer is top coal ...
Friday, 15 January 10
NTPC TO ADD 6,000 MW EACH YEAR IN 12TH PLAN
Will raise total generation capacity to 75,000 Mw by 2017, up from 30,644 Mw at present.
India's largest power generator NTPC, which will launch ...
Friday, 15 January 10
POSCO SAYS 2010 COKING COAL AGREEMENT MAY BE DELAYED - BLOOMBERG
Posco, South Korea’s biggest steelmaker, said an agreement on coking coal prices for this year may be delayed because major suppliers of the s ...
Friday, 15 January 10
CHINA POWER FIRMS SEEK COAL IMPORTS, SUPPLY SCARCE
China's coal-hungry power plants have turned to imported coal to cope with widespread shortages, but spot supply is scarce, traders said on Thursda ...
Thursday, 14 January 10
INDONESIA POWER REDUCES COAL SUPPLY
PT Indonesia Power will reduce coal supplies from PT Tambang Batu Bara Bukit Asam to its Suralaya Power Plant. "The coal supply for the plant s ...
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- Lanco Infratech Ltd - India
- SMG Consultants - Indonesia
- Bulk Trading Sa - Switzerland
- TeaM Sual Corporation - Philippines
- Mercuria Energy - Indonesia
- Merrill Lynch Commodities Europe
- Parliament of New Zealand
- Central Electricity Authority - India
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Cement Manufacturers Association - India
- Gujarat Sidhee Cement - India
- Larsen & Toubro Limited - India
- London Commodity Brokers - England
- MS Steel International - UAE
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Planning Commission, India
- IHS Mccloskey Coal Group - USA
- Chamber of Mines of South Africa
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Asmin Koalindo Tuhup - Indonesia
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Power Finance Corporation Ltd., India
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Eastern Energy - Thailand
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Indonesian Coal Mining Association
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Sindya Power Generating Company Private Ltd
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- New Zealand Coal & Carbon
- Star Paper Mills Limited - India
- Kapuas Tunggal Persada - Indonesia
- The Treasury - Australian Government
- Bhoruka Overseas - Indonesia
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- Coal and Oil Company - UAE
- Energy Development Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- PTC India Limited - India
- Posco Energy - South Korea
- Gujarat Mineral Development Corp Ltd - India
- Samtan Co., Ltd - South Korea
- Commonwealth Bank - Australia
- LBH Netherlands Bv - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining and Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Meralco Power Generation, Philippines
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Central Java Power - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Tamil Nadu electricity Board
- McConnell Dowell - Australia
- Semirara Mining Corp, Philippines
- Heidelberg Cement - Germany
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Pipit Mutiara Jaya. PT, Indonesia
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Xindia Steels Limited - India
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- Petron Corporation, Philippines
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Karaikal Port Pvt Ltd - India
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- ICICI Bank Limited - India
- Medco Energi Mining Internasional
- Directorate Of Revenue Intelligence - India
- Therma Luzon, Inc, Philippines
- Romanian Commodities Exchange
- Deloitte Consulting - India
- ASAPP Information Group - India
- Orica Australia Pty. Ltd.
- Kalimantan Lumbung Energi - Indonesia
- Agrawal Coal Company - India
- Jorong Barutama Greston.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- India Bulls Power Limited - India
- Intertek Mineral Services - Indonesia
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Coastal Gujarat Power Limited - India
- Kaltim Prima Coal - Indonesia
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bharathi Cement Corporation - India
- Formosa Plastics Group - Taiwan
- Sakthi Sugars Limited - India
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- VISA Power Limited - India
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- Kideco Jaya Agung - Indonesia
- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Sree Jayajothi Cements Limited - India
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Mercator Lines Limited - India
- Economic Council, Georgia
- Jindal Steel & Power Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Ministry of Mines - Canada
- Karbindo Abesyapradhi - Indoneisa
- GVK Power & Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Wood Mackenzie - Singapore
- Indogreen Group - Indonesia
- Carbofer General Trading SA - India
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- Standard Chartered Bank - UAE
- Aboitiz Power Corporation - Philippines
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Bhushan Steel Limited - India
- Tata Chemicals Ltd - India
- Altura Mining Limited, Indonesia
- IEA Clean Coal Centre - UK
- Anglo American - United Kingdom
- Madhucon Powers Ltd - India
- Vedanta Resources Plc - India
- Aditya Birla Group - India
- Dalmia Cement Bharat India
- Siam City Cement - Thailand
- Port Waratah Coal Services - Australia
- Jaiprakash Power Ventures ltd
- Minerals Council of Australia
- PetroVietnam Power Coal Import and Supply Company
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Energy Exchange, India
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- Electricity Authority, New Zealand
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- Trasteel International SA, Italy
- Bayan Resources Tbk. - Indonesia
- GN Power Mariveles Coal Plant, Philippines
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